Challenger bank TSB has called on regulators to use the "full force of competition" to help it break the stranglehold of the Big Five banks in the UK as it posted a surge in profits and new customers.

Paul Pester, chief executive of TSB, said the lender was "doing its bit" to increase competition in high street banking, attracting more than 1,200 new customers a day in the first quarter - up 25% year-on-year.

But he said the Competition and Markets Authority (CMA), which is nearing the end of a two-year inquiry into UK retail banking, needed to do more to promote switching and make charges clearer.

He said: " We need the CMA to use the once-in-a-generation opportunity they have to help us bring the full force of competition to bear on the UK banking market."

His plea came as the group - spun out from Lloyds Banking Group and then taken over by Spanish rival Banco de Sabadell last March - posted a 53.4% year-on-year hike in bottom-line profits to £52.6 million in the first three months of 2016.

TSB said it notched up record growth in customer savings deposits, up £2.1 billion year-on-year to £26.8 billion in the first quarter and a £900 million or 3.5% rise on the previous three months.

Mr Pester said the results showed the group was making good strides in taking on its big rivals - Barclays, Lloyds, NatWest, HSBC and Santander - but added "we can't do this alone".

He said: "We want all bank customers to know what they're paying for their banking; all customers - including overdraft users - to be able to switch easily; and all customers to be aware of their right to switch banks.

"Only then will competition really start to work and the culture of UK banks finally shift to serving customers on their terms - rather than on the banks'."

The CMA is due to publish its final report next month.

It has so far stopped short of breaking up the big banks, instead recommending a raft of proposals to help promote switching after i t revealed last October that bank customers could save £70 on average a year by changing current account providers.

TSB is one of a number of smaller players that has entered the market in recent years, alongside other challengers such as Metro Bank, which reported its first quarter figures on Wednesday.

Metro Bank, which floated on the stock market in March, trimmed underlying losses by 7% to £7.9 million, although £3.2 million in costs for its stock market listing saw it post bottom-line losses of £11.1 million.

It said customer savings deposits surged 15% during the first three months of 2016 to £5.9 billion and attracted a record 62,000 new customers in the quarter, while net lending more than doubled year on year to £4.1 billion.

The major banking groups report their first quarter updates next week, starting with Barclays and Spanish-owned group Santander on Wednesday.

Mr Pester said he did not believe the CMA proposals went far enough and called for next month's final report to get tougher on the banking sector.

On the EU referendum, he said it was "up to the UK electorate to decide", but added it was an "uncertainty" for the banking sector.

TSB said it saw £1 billion in net mortgage lending - loans less redemptions - in the first quarter as a £300 million reduction in mortgages from its Northern Rock and Lloyds portfolio offset £1.3 billion in growth from its own direct lending.

The group also confirmed it had 4.8 million current account customers after taking a 7% share of all those opening a new account or switching in the three months to March 31.

It started with 4.2 million current account customers when it was spun off from Lloyds in 2013.